Freddie Mac’s Credit Risk Transfer (CRT) program—which transfers credit risk away from U.S. taxpayers to global private capital via securities and (re)insurance policies—reported record first half CRT issuance of $9.9 billion, protecting $418.9 billion unpaid principal balance of mortgages.
Second quarter CRT issuance of $3.5 billion, credit protecting $173.6 of single-family mortgages and record first quarter issuance of $6.4 billion, credit protecting $245.4 billion of single-family mortgages boosted the half. The issuances included STACR®, ACIS®, subordination and certain lender risk sharing transactions.
“Our first half CRT issuance increased notably year-over-year due to the swell of purchase and refinance activity, as well as our ability to shorten the time from loan acquisition to ACIS issuance, in the first quarter,” said Freddie Mac’s Mike Reynolds, vice president of Single-Family CRT. “In our strongest half to date, we completed the largest transactions in the history of the STACR and ACIS programs, drew 111 investors and continued to attract new capital to the CRT markets.”
Through its flagship offerings alone, Freddie Mac issued approximately $9.1 billion across five STACR and seven ACIS transactions in the first half, which exceeded the previous first half high of $5.5 billion in the first half of 2020. Among the notable transactions were STACR 2021-HQA1 and ACIS 2021-SAP1, with record-setting issuances of $1.4 billion and $1 billion, respectively.
Since the first CRT transaction in 2013, Freddie Mac’s Single-Family CRT program has cumulatively transferred approximately $83 billion in credit risk on approximately $2.3 trillion in mortgages through STACR, ACIS, certain senior subordination securitization structures and certain lender risk sharing transactions. As of June 30, 2021, 49% of the Single-Family mortgage portfolio was covered by credit enhancement.
Source: Freddie Mac
